Tax on high incomes voted in

You will need to earn at least €250,000 to pay the tax

MPs have voted through a tax on high incomes, starting at half the income level originally proposed

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A TAX on very high incomes has been voted through by the MPs.

The measure, which is part of the government’s austerity plan, involves an extra tax at 3% on incomes between €250,000 – €500,000 and 4% above this.

The threshold has been reduced from €500,000, which was originally proposed.

It would be calculated on the revenu fiscal de référence (net taxable income) said Budget Minister Valérie Pécresse; it would be on top of income tax and would last until the public finances are balanced.

About 27,000 homes are likely to be affected and it is expected to raise about €410 million a year.

The MPs have however rejected a proposal by UMP Party MP Michel Piron to add a new higher income tax band at 46% for income above €150,000 per family quotient part.

The measure will now have to be agreed by the Senate before it goes ahead, and could apply to 2011 income declared next year.

Socialists said the measure would not offset the lesser taxation of the rich represented by this year’s wealth tax reform.

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